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Minority raises red flag over new Common Fund allocation formula

Author: Musah Yahaya Jafaru
Mr Benjamin Kpodo
Mr Benjamin Kpodo

The Minority in Parliament has described the government's purported directive to metropolitan, municipal and district assemblies (MMDAs) to use 80 per cent of their District Assemblies Common Fund (DACF) allocation to support its flagship projects as illegal.

According to the Minority, the directive by the government was against the disbursement formula approved by Parliament.

It said the directive would deny the MMDAs of the needed funds to embark upon localised development projects.

Speaking at a press conference in Accra yesterday, the Deputy Ranking Member on the Local Government and Rural Development Committee of Parliament, Mr Benjamin Kpodo, said per the formula approved by Parliament in March 2018, the allocation to people with disabilities (three per cent,) amounted to GH¢54,364,333; national projects — education, seed capital for newly created district assemblies and waste management (11.59 per cent) amounted to GHc210,000,000 and direct allocations to MMDAs (50.25 per cent) amounted to GH¢905,999,982, among other allocations.

However, he said the Minority had information that a directive had gone out to the MMDAs that the direct transfer allocated to and approved for the MMDAs should be strictly applied as follows: School feeding programme – 40 per cent  (GH¢362,399,992.80); Nation Builders Corps - 20 per cent (GH¢181,199,996.40); Planting for Food and Jobs - 20 per cent (GH¢181,199,996.40) and balance for assembly’s own projects – 20 per cent (GH¢181,199,996.40).

Withdraw directive

Mr Kpodo asked the government to immediately withdraw the directive and find other means of funding its flagship projects.

"The government should explore and find other means of funding its flagship programmes and projects, as directed by Parliament on March 22, 2018. It has become notorious for the government to run to the DACF to prey on its resources whenever it needs money for anything extra-budget," he said.

Mr Kpodo

Mr Kpodo asked the government to desist from any further acts that sought to deprive the assemblies of lawful funds due  them for the implementation of their local developmental agenda.

He again requested the government to "take steps to regularly and timeously release money due the DACF, as stipulated in the Constitution (on a quarterly basis) and avoid holding such funds long in arrears”.

"Indeed, as a constitutionally established fund, the DACF should have priority over all other disbursement from ‘total’ revenue," he stressed.

 Minority for court over Petroleum Fund

In another development, the Minority in Parliament has threatened to go to court over what it termed as the government's breach of the Petroleum Revenue Management Act and the Ghana Infrastructure and Investment Fund Act.

The Minority Spokesperson on Finance and Ranking Member on the Finance Committee, Mr Ato Forson, told journalists that the act stipulated that 70 per cent of the Petroleum Fund should go into the annual budget funding amount (ABFA) and 70 per cent of that amount should be dedicated towards infrastructure development and the remaining 30 per cent used for goods and services.

However, he said the government was rather allocating much of the fund to support  the free senior high school (SHS) education policy and other consumption areas, to the disadvantage of road construction and other infrastructure development.

Mr Forson was speaking with journalists moments before the adoption of the report of the Finance Committee on the 2017 annual report of the Petroleum Fund.

He said the Minority was speaking with its lawyers on the breach of the act and indicated that it would "soon" go to court over the issue.

He first raised the issue of failure to apply the 70 per cent allocation to infrastructure on the floor of Parliament but a Deputy Minister of Finance, Mr Kwaku Kwarteng, gave a rebuttal.

Mr Kwarteng said the money was not used to support only goods and services, as was being stated, but also to fund capital projects.

He said substantial portions of the ABFA had gone into the development of human capital.

For instance, he said, the investment being made in education was an important aspect of developing human capital.